News

New plan to create 93,000 extra jobs from start-ups over the next five years

Minister Bruton – we have many great entrepreneurs in Ireland, we just don’t have enough of them

A new plan aimed at creating an extra 93,000 jobs from start-up companies in the next five years was today launched by Minister for Jobs Richard Bruton TD together with Minister of State for Business and Employment Ged Nash TD and Minister of State for Skills, Research and Innovation Damien English TD.

Central Bank research shows that start-up companies in the first five years of existence account for two thirds of all new jobs created in Ireland; as part of the Action Plan for Jobs the Government committed to develop and implement a plan to increase the number of entrepreneurs in Ireland and thereby support thousands of extra jobs.

The Government’s National Policy Statement on Entrepreneurship in Ireland represents the first time a Government has published a comprehensive national plan for entrepreneurship. It is the Government’s plan to deliver an ambitious but realistic increase in the numbers of start-ups in Ireland over the next five years.

The plan follows on from and draws on the report of the expert Forum on Entrepreneurship, chaired by Sean O’Sullivan, and published earlier this year. The Minister and his Department also consulted with academics and entrepreneurs, other Government Departments and Agencies as well as the national business community through the Action Plan for Jobs forums in drawing together the plan.

The key target contained in the plan is to double the jobs impact of start-ups in Ireland over the next five years, from 93,000 currently. In order to deliver on this we must:

Increase the number of start-ups by 25% – representing 3000 more start-ups per annum

Increase the survival rate in the first five years by 25% – 1800 more survivors per annum

Improve the capacity of start-ups to grow to scale by 25%

Key measures in the plan include:

Doubling the volume of funding to start-ups in Ireland from business angel investment. Angel investors are successful entrepreneurs or executives who invest private funds in start-up businesses. Analyses of successful start-up environments around the world, in areas including Israel and Silicon Valley, repeatedly point to the existence of business angel networks as key elements. A total of approximately €70million is currently invested per annum by business angel investors in Ireland.

Co-working and accelerator spaces available for start-up businesses right across the country. The LEOs and the Community Enterprise Centres will form a key part of this – and this will be part of a new system of supports for start-ups locally. Included in this will be new competitive calls for funding, following on from the model pioneered successfully in the Ireland’s Best Young Entrepreneur competition, which attracted over 1000 applicants from around the country

New mentoring services for start-ups, including a national database of mentors

Entrepreneurship programmes in schools, third and fourth level education, and in new apprenticeships systems

New targets for Agencies, including a 12% increase in start-ups supported by Enterprise Ireland by 2015

New marketing plan to promote Ireland abroad as a location for international start-ups

Measures to promote entrepreneurship among under-represented groups – including women, young people, migrants and older people

Specific reductions in the administrative burdens facing start-ups, including the length of time it takes to register a new business and the burden of applying for licences

New supports for innovation by start-ups, and ambitious targets for EI and SFI to increase innovation activity by start-ups

New measures to support start-ups to sell abroad, including opportunities in supply chain of IDA companies

An annual report to the Minister for Jobs, analysing Ireland’s performance in entrepreneurship against domestic and international benchmarks

The plan also sets out a range of issues in the taxation system which, if addressed, could provide a major boost for the prospects for start-ups in Ireland – however consideration of these matters will ultimately be matters for the Minister for Finance and Cabinet in the context of Budget 2015 and future Budgets, including:

Share-based remuneration in private companies

Seed Capital Scheme and Employment and Investment Incentive

Capital Gains Tax

Income tax

The measures in the plan will be implemented through the Action Plan for Jobs process in 2015 and future years. It is anticipated that entrepreneurship will be included as a Disruptive Reform in the 2015 plan.

Speaking today, Minister Bruton said: “In Ireland we have great entrepreneurs – we just don’t have enough of them. Given that two thirds of all new jobs come from start-ups, it is crucial that we improve our supports in this area if we are to create the jobs we need. That is why earlier this year I asked a group of academics and successful entrepreneurs – the people who have actually done it – to come up with a list of recommendations for how we can improve our performance in this area. Many of their recommendations were for business or private institutions to implement – but there is much that Government can do to incentivise, support, promote and encourage more people to start businesses – and that is what today’s plan is about.

“We have set ambitious but realistic targets for ourselves – most importantly, a doubling of the jobs impact of start-ups by 2019. We have set out what Government will do to help deliver on this –including interventions in mentoring, access to finance, education, promoting start-up as a career option, and providing spaces where entrepreneurs can work. More and more people in Ireland are choosing to create a job, instead of getting a job – I am convinced that with the right supports from Government we can deliver a step-change in this area and create tens of thousands of jobs that we badly need”.

Minister Nash said: “Entrepreneurship is critical to the health of the Irish economy. We now have a comprehensive policy to support our existing entrepreneurs and to ensure a steady pipeline of future business founders. Start-up companies usually begin on a small scale, and as the Minister with responsibility for SMEs I am determined to work with, and on behalf of, small businesses to implement this strategy with my ministerial colleagues. We need to encourage more people to start their own businesses and have the supports in place to assist more companies survive the difficult first few years – this strategy is the blueprint to do just that.”

Minister English said: The dynamic process of entrepreneurship and new firm creation introduces new innovations throughout the economy. Therefore, entrepreneurship in combination with innovation has a vital role in sustained economic growth and job creation. Generating fresh solutions to problems and the ability to create new products, processes or services is where the entrepreneur can be a driving force”.